Bertucci’s: Filing Alert & Committee Formation Meeting Notice

Italian restaurant owner and operator Bertucci’s Corporation filed for Chapter 11 bankruptcy protection on April 15, 2018.  The case is pending in Delaware.

Company Overview

Bertucci Info.jpgBertucci’s  was formerly known as NE Restaurant Company, Inc.  It changed its name to Bertucci’s Corporation in August 2001. Founded in 1981, the company is based in Northborough, MA.  Today Bertucci’s owns and operates a chain of 59 casual dining Italian restaurants in the Northeast and Mid-Atlantic.

A Bankruptcy Sale

The filing sets up a process to sell the company to Right Lane Dough Acquisition, LLC (an affiliate of Right Lane Capital) or an overbidder.  The proposed purchase price is $1.7 million in cash and a “credit bid” of up to $4 million.  In addition, the buyer will provide the company with exit financing in the form of $14 million in new second lien notes.

A Struggling Restaurant Market

Like others before it, Bertucci blames its bankruptcy filing on a proliferation of fast-casual restaurants and market oversaturation.

Bertucci’s, and the casual family dining industry generally, have suffered “a prolonged negative operating trend in an ever increasing competitive price environment.”

Since 2011, the company has experienced year-over-year declines in sales and revenue.

In fact, Reorg. First Day states that Bertucci’s is the third Massachusetts-based restaurant chain it has covered in recent years.  The others were Boston-based fast casual restaurant Cosi and the Sagamore-based restaurant chain Bugaboo Creek Steakhouse.

The Committee Formation Meeting

The company states it owes roughly $9 million to vendors, landlords, and other unsecured creditors.  The U.S. Trustee has scheduled a meeting to form a committee of unsecured creditors in the case.  The meeting will take place at 10:00 a.m. on Friday, April 27, 2018.  It will be held at the Delaware State Bar Association on 405 King Street, 2nd floor, in Wilmington, Delaware.  If you would like a copy of the formation notice, it is available here.

Barn Clouds.jpegThe weather forecast?  A very civilized high of 66 degrees.  With mostly cloudy skies becoming partly cloudy later in the day.  Because it is always partly cloudy in Delaware.  Except when its raining.  Or snowing.

Mette K.

Filing Alert: Nine West Files Chapter 11 in New York

Nine West Holdings has just commenced a chapter 11 case in the U.S. Bankruptcy Court for the Southern District of New York.  Bankruptcy Case #1:18-bk-10947.

More details to follow…

Mette K.

 

Filing Alert: Southeastern Grocers Files Pre-Packaged Chapter 11 in Delaware

Update: An audio recording and presentation materials from Reorg Research’s webinar covering the Southeastern Grocers chapter 11 filing are now available here.  In the webinar, their coverage team provides an overview of the company and its financials, prepetition developments and creditor negotiations, and the chapter 11 filing, including highlights from the first day hearing.
Mette K.
4/2/18

 


Southeastern Grocers has commenced chapter 11 proceedings in Delaware. The company reports $1 to $10 billion in assets and liabilities.

“This course of action enables us to continue writing the story for our company and our iconic, heritage banners in the Southeast.”

—Anthony Hucker, President and Chief Executive Officer

The Restructuring Support Agreement

The filing was preceded by a Restructuring Support Agreement.  According to the company’s Press Release, the filing and accompanying pre-packaged plan are the next steps in implementing that agreement.  Creditors holding 80% of Southeastern’s 8.625%/9.375% senior PIK toggle notes due September 2018 are party to the RSA.  Private equity sponsor Lone Star Capital has also signed on. The restructuring will decrease overall debt levels by more than $500 million.

What About Suppliers, Trade Creditors, and Landlords?

Southeast Grocers has indicated that all general unsecured claims, including supplier partners and trade creditors, will be paid in full.  A letter to suppliers and a FAQ sheet are available on the company’s website.  More than 580 stores are expected to continue operating during the restructuring process.  However, the company intends to close 94 underperforming stores.  A list of Affected Stores is available here.

Mette K.
3/27/18

 

Filing Alert: #Remington Files Chapter 11 in Delaware

Without a foil to drive sales, and beset by litigation, Remington Outdoor Company has sought Chapter 11 protection Delaware.

Company Background.

Founded in 1816, Remington is one of the oldest gun makers in the world.  Its products include the Bushmaster AR-15 style rifle that was used in the 2012 Sandy Hook shooting. Twenty children between six and seven years old, as well as six adult staff members, were killed. The company has been sued by victims’ family members.  In addition, the company’s sales fell 30% last year in the midst of an industry-wide “Trump slump.”

The Fast-Track Plan and Support Agreement.

Remington reports $100 million to $500 million in assets and liabilities. Its filing includes:

  • A plan, disclosure statement, and restructuring support agreement between Remington and its major secured creditors;
  • A motion seeking approval of a $100 million in financing, a $45 million bridge loan, a $193 million asset-based loan facility.

Under the fast-track plan, Remington’s key creditors – reportedly, Franklin Templeton Investments and JPMorgan Asset Management – would exchange their debt holdings for most of the company’s equity. Concurrently, the company’s current owner, Cerberus Capital, would relinquish its ownership interests. Remington has already begun soliciting approval of its plan. It has asked to forgo the usual procedure of filing a full schedule of its debts and assets.  And it has requested a voting deadline of April 26th and hopes to confirm its plan around May 3rd.

Remington has said that its efforts to finance a turnaround were complicated by parties who were reluctant to lend to a gun manufacturer. The creditors in the current deal reportedly agreed to the “debt-for-equity swap” prior to the Parkland shooting, and it is unclear if any have since pulled out.

Additional Information.

The case number is 18-10684.  Additional information, including the docket of filed pleadings and instructions for filing claims, can be found on its claim agent’s website: PrimeClerk.com.

Mette K.

1-Year Later: A California Attorney Joins the Delaware Bar. And Opens a Bar!

On March 27, 2017, I told you that I was planning to move to Delaware and that Jeff was planning to open a bar here in Wilmington after we settled in.  Well, here we are one year later, and I am officially a member of the Delaware bar.  And Jeff now owns and runs Catherine Rooney’s in Newark, Delaware. We have just recovered from our first St. Patrick’s Day as Irish pub owners, so its time to catch everyone up. But suffice it to say, we are all in on Delaware!

First, I Passed the Delaware Bar.

Obtaining admission to the Delaware bar was a grueling process, the triathalon of the legal profession if you will.  It required passing the Delaware bar exam.  Which, for the record, was much more difficult than the California bar exam.  It required completing the “scavenger hunt,” a 20-week long clerkship.  And it required undergoing a rigorous background check that entailed gathering up 30 years of documents scattered across two continents.pexels-photo-92323  Judge Shannon described the four-phases of this process perfectly.

  1. Enthusiasm.  “It will be a long and difficult process, but I have this! Let’s do it!”
  2. Resignation. “This is really hard.  I’m think I’m going to fail.”
  3. Anger. “I’m sure I failed. This is a stupid process that absolutely does not capture my value as a person or lawyer.”
  4. Hypocrisy.  “Woo-ho! I passed! What a great system for ensuring that only top lawyers achieve admission to the bar.”

But more importantly, what this process taught me is that people are, without a doubt, much more interested in Jeff’s new bar than my efforts to pass my bar!

Then, Jeff Opened a Bar: Catherine Rooney’s!

Rooneys SnowJeff initially planned to open a new bar in downtown Wilmington.  We had the name, concept and business plan sketched out before we arrived.  But after doing some research once we got here, Jeff politely pointed out that nobody stays in Wilmington after hours.  And he cannot run a profitable bar giving away drinks to its only patrons, my friends who happen to be in town for hearings.  Fair point.

Guiness.jpgSo,  Plan B!  Jeff instead purchased Catherine Rooney’s, a popular Irish pub located on Main Street across from the University of Delaware in Newark.  While it’s not downtown, it’s only about 15-20 minutes away.  And everyone who we have gotten to know in the process – the staff, the townies, the university students and professors, other business owners in the area, the former owners – have been incredibly warm and welcoming.  And of course, we have Guinness.  Harp on tap.  Whiskey.  Great pub food.  Live music.  And a private room upstairs with a second bar, perfect for private events and entertaining.  Expect us to be making good use of that space!

For those of you wondering what it is like being an old couple and owning a bar in a college town, the following video from about 11:00 a.m. on St. Patrick’s Day pretty much says it all….!

Keep following for more updates and adventures!

Or check out Catherine Rooney’s on Instagram @rooneysnewark or on Facebook @CatherineRooneysNewark.

Mette K.